Uncertain Recovery?

The Governor of the Bank of England, Mervyn King, yesterday painted an uncertain picture of the UK’s recovery.  He said that currently the economy “bumps along the bottom,” and that a ‘double-dip’ is likely – in other words, that a quarter of negative growth will happen this year, meaning another descent before the recovery heads back up.

Doesn’t sound particularly hopeful, but Mr King and his committee say that they don’t rule out re-introducing the quantitative easing method if the economy needs it.  City economists are certain that the base interest rate will remain very low until next year – by the end of this year it is expected that it will still be below 1%.

The BoE is still confident that the pound sterling’s depreciation (helped by QE) will prove successful in the coming months and year.

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